The 2026 expansion across America’s formerly beset manufacturing sector broadened meaningfully in July, the first of this week’s top-tier US macro releases showed.

At 55.6, the ISM headline easily topped estimates and counted as the best print in more than four years. Consensus was 53.9.

As the figure below reminds you, America’s factories were mired in a seeming “forever recession” prior to this year’s turnabout.

Suffice to say the AI capex boom was a veritable godsend.

The new orders index (the main demand gauge in the report) ticked up to 56.7, while the production gauge soared more than 6ppt MoM to 58.5.

Although the share of the manufacturing economy that contracted last month quadrupled from 5% to 20%, the share experiencing a “strong contraction,” which ISM defines as a PMI of 45 or below, fell to zero.

Notably, the employment gauge improved to 52.8, the first expansion-territory print since January of 2025. Or since September of 2023 in the revised series. Either way it’s the best read since August of 2022.

At the same time, the prices index moved lower to 71.1, still indicative of pervasive price pressures but a new post-Iran war low all the same.

You don’t need a lot of complicated analysis here. This was a decent report. A panelist in Computer & Electronic Products summed up the macro zeitgeist. “We continue to operate in a favorable demand environment driven by growth in the semiconductor, AI and high-performance computing markets,” that respondent said. “Recent company reports indicate strong sales growth and continued investment in manufacturing capacity.”

Still, there were nearly two negative comments for every positive remark. “Pricing volatility” came up in most of the negative comments. The war likewise featured heavily in those replies.